Korean Farmers Struggle: Falling Prices, Higher Costs

SOUTH KOREA - Korean cattle farmers have been hit by falling cattle prices, largely due to an increased supply of domestic beef, while soaring animal feed prices have pushed up production costs, reports Meat and Livestock Australia (MLA).
calendar icon 12 January 2012
clock icon 1 minute read
Meat & Livestock Australia

MLA reports that Hanwoo (local beef) cattle herd numbers were almost 1.5 million in 2004, but rose to just above three million head last year, along a steady decline in prices at the farm gate. While the average price for a 600-kilogram cow during 2004 was around KRW5.2 million per head (A$6,188), that price dropped to an average of KRW3.4 million (A$3,314) last year (Nonghyup). On top of this trend, Korea struggled with foot-and-mouth disease early last year, which impacted local beef consumption.

However, Korean consumers have not enjoyed these price falls, which is largely attributed to Korea’s complex distribution network, which reportedly makes up approximately 40 per cent of retail beef prices and involves a minimum of five stages.

An official at the Ministry for Food, Agriculture, Forestry and Fisheries (MIFAFF) stated that the increased supply of beef could continue for another four to five years (Dong-A Ilbo). To assist farmers, the Korean government announced it will increase slaughter levels and compensate farmers. Korea’s MIFAFF also reported it would increase the supply of local beef to the military, while some discount retailers said they would increase in-store promotions to help drive consumption.

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